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This Old House: Historical Restoration as a Neighborhood Amenity

This Old House: Historical Restoration as a Neighborhood Amenity <p>ABSTRACT:</p><p>Property markets do not fully price the public&apos;s value for historic homes to correct the intergenerational externality associated with historical preservation. While preservation for future generations often provides the primary motivation for Pigovian subsidies, historical preservation or restoration policies may also have significant contemporary amenity effects. This study exploits unique data on the use of rehabilitative tax credits (RTCs) in Virginia to estimate the extent to which historic property investment generates market externalities for nearby nonhistoric properties. Using a difference-in-differences approach, the results indicate that homes in close proximity to RTCs sell at a premium, with only modest liquidity effects. <i>(JEL H23, R38)</i></p> http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Land Economics University of Wisconsin Press

This Old House: Historical Restoration as a Neighborhood Amenity

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Publisher
University of Wisconsin Press
Copyright
Copyright by the Board of Regents of the University of Wisconsin System.
ISSN
1543-8325

Abstract

<p>ABSTRACT:</p><p>Property markets do not fully price the public&apos;s value for historic homes to correct the intergenerational externality associated with historical preservation. While preservation for future generations often provides the primary motivation for Pigovian subsidies, historical preservation or restoration policies may also have significant contemporary amenity effects. This study exploits unique data on the use of rehabilitative tax credits (RTCs) in Virginia to estimate the extent to which historic property investment generates market externalities for nearby nonhistoric properties. Using a difference-in-differences approach, the results indicate that homes in close proximity to RTCs sell at a premium, with only modest liquidity effects. <i>(JEL H23, R38)</i></p>

Journal

Land Economics – University of Wisconsin Press

Published: Apr 11, 2019

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